Repap Resources submits bid for Fort Francis mill

CBC News — A private investment group has made an offer for the shuttered mill in Fort Frances, Ont., and says, if its bid is successful, it will restart the plant, putting hundreds of people to work.

The mill, owned by Resolute Forest Products, was closed in 2014 and no deal has yet come together for the property, although there has been reported interest. Repap Resources Group is the latest to announce its intentions to buy the mill.

According to a report by CBC News, Repap’s “multi-million dollar offer” for the kraft paper plant, which it submitted prior to a March 15 deadline, also contains proposals to work cooperatively with Resolute, including offering saw logs it harvests to Resolute’s sawmills in Ignace and Atikokan in exchange for wood chips as well as an offer to purchase raw pulp from Resolute’s Thunder Bay mill, said Repap’s president, Sean Twomey.

“We believe that we’ve made an offer to Resolute that is financially attractive, that offers long-term operational benefits for their sawmills,” Twomey told CBC News. “And from a public policy standpoint, obviously, [one that] creates between six and seven-hundred jobs.”

About half of those jobs each would be in mill and forestry operations.

A spokesperson for Resolute confirmed it received the Repap bid and is reviewing it. The company wouldn’t confirm Friday if any other potential suitors had made offers for the Fort Frances mill.

Town officials in Fort Frances have raised concerns that the mill could be sold for scrap and demolished; the town said it has informed Resolute that, should the property ever come up for demolition, those owners would, under municipal site control plans, effectively be required to provide the town with a $20 million line of credit and undertake a number of third party studies.

Repap’s offer is contingent on the company acquiring “sufficient” access to wood supply in the region, Twomey said. Concerns over that access by companies looking to purchase the mill have also been raised by Fort Frances town council, but on Friday, Mayor June Caul issued a statement saying that the province has told stakeholders it is committed to making wood available to any purchaser that will run the mill.

For his part, Twomey said the company is “cautiously optimistic” that they’ll be able to secure rights to enough of a wood supply from the province, adding that they’re also looking at what his company itself can do to minimize the amount of wood it needs to run the mill.

Natural Resources Minister Greg Rickford has told CBC News the provincial government is monitoring the sale process for the mill, saying that the end result “is all about doing the right thing with, and for, Fort Frances.”

Twomey said he’s received support from all levels of government.

“The government of Ontario has to make a decision as to the interests of the people of Ontario but we are absolutely certain that there is enough fibre to ensure that all stakeholders continue effectively in operation,” he said.

“We believe that we have an offer that is capable of closing and, therefore, is worthy of appropriate consideration.”

Kursman said there’s no timeline on how long it could take Resolute to make a decision on the potential sale of the mill.

Twomey said a “critical part” of his company’s proposal also involves “explicit commitments” to area First Nations over employment and economic development.